Two MA's Binary Options Trading Strategy - How It Works

Two MAs binary options trading strategy is a quite simple method based on moving averages for EUR/USD currency pair on the H1 timeframe. Although other timeframes are applicable to this strategy, different settings have to be chosen separately.

How to use Two MAs Strategy?

One of our followers has sent this trading strategy, saying that a certain number of traders use it in profitable trading, despite the fact that it’s using simple indicators.

Moving Average (MA) is a price based, a lagging indicator that displays the average price of a security over a set period of time.

First of all, we should add the following moving averages to the chart:

Exponential Moving Average with the period of 120 hours (blue curve on the screenshot below);

Exponential Moving Average with the period of 10 hours (green curve on the screenshot below).

Conditions for buying CALL options according to Two MA’s binary options trading strategies are as follows:

The price is above the EMA120;

Once the price reached and touched EMA120 from upside, we buy a CALL option in the range of 0 to 5 pips (buy-limit order is possible);

The nearest high level of the price is our target;

We stop buying CALL options if the price goes down for a distance of 50% of the profit target. The trailing stop-order could also be used on lows and points touching EMA10.

Conditions for buying PUT options according to “Two MA’s” binary options trading strategies are as follows:

The price is below the EMA120;

Once the price reached and touched EMA120 from downside, we buy a PUT option in the range of 0 to 5 pips (sell-limit order is possible);

The nearest high level of the price is our target.;

We stop buying CALL options if the price goes down for a distance of 50% of the profit target. The trailing stop-order could also be used on lows and points touching EMA10.

If you like this strategy, you might also be interested in this Bollinger Bands StrategyAdditional conditions and filters for Two MA’s binary options trading strategy:

If the price crossed or closed breaching EMA120 (even with the single candle), that’s a base to stop buying options in the same direction when the price comes back to EMA120 (in the range of 0 to 5 pips) and reversal in the opposite direction.

If the breakthrough candle closed in the range of 0 to 5 pips, a deal on the next candle opening is possible without waiting for the bounce to EMA120.

The candle’s body, which is approaching the EMA, should not exceed 60 pips.

The take-profit order has to be equal to 20 pips at least. Otherwise, the deal has to be cancelled.

The minimal stop-loss order has to be equal to 15 pips.

Once the price crosses EMA10, the deal should be set to non-risk mode, and if the stop-loss order triggered, the next bounce candle should occur before opening another deal in the same direction.

The statistics of using Two MAs binary options trading strategy during the 10 months period starting from January 2018 is positive with the total profit of 1412 pips. The overall profitable positions showed 2797 pips while negative deals took a loss of 1385 pips with the maximum drawdown of 171 pips occurred.

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